2 Winners, 1 Loser in America 2.0 Surge
I am #BOP (bullish, optimistic and positive) on America’s economy!
And here’s why.
There’s actually a trio of incredible news for our America 2.0 mega trends.
I see two STRONG winners … and one major loser stuck in the America 1.0 dust.
The bottom line is our economy is booming despite the negativity and fears you’ll hear in the mainstream media.
And you are in the best position to profit.
Watch below to find out about the America 2.0 lollapalooza and the best sectors for the new year’s economic surge:
This past week has been extremely action-packed here in the U.S., especially on the economic front.
At the time of this taping, U.S. stock futures are pointing higher today as investors react to the possibility President Trump may soon be discharged from the hospital. We do wish him, and all others affected by the virus, a full and speedy recovery.
Economic Data Points to Bullish Forecast
Where recent U.S. economic data is concerned, we saw a trio of encouraging statistics released last week. These stats underpin our America 2.0 bullish forecast. The first positive sign is from the consumer realm.
As this chart shows, consumers are confident. September saw the largest gain in the consumer confidence index in 17 years.
Respondents said they were “more likely to make big purchases in the months ahead.” A large share of respondents expects “more jobs and better business conditions in the months ahead.”
Secondly, this enthusiasm is spilling over into the upcoming holiday season shopping forecast, especially in online shopping as well as eCommerce.
Per a recent survey conducted by RetailMeNot.com and reported by Consumer Affairs, 66% of U.S. consumers expect to spend the same amount of money or more on holiday shopping this year. Many are turning to online websites to shop for their lists. This plays into our America 2.0 booming retail digital transformation forecast.
Thirdly, in my tweet on September 29, all I could say was “Wow.” U.S. housing continues to fire on all cylinders. The U.S. pending home sales for August hit the highest level on record.
It’s the highest level since record-keeping began in 2001 for this index. Contracts to buy previously owned homes jumped 8.8%, beating estimates of 3.1%. This is the fourth straight monthly gain. Bold Profits’ megatrend of millennials who are focused on household formation and ultra-low mortgage rates are to thank.
As Paul has been pointing out for years now, this housing boom is not a surprise to us at Bold Profits, nor our readers. The housing market is booming due to a massive housing shortage that began after the 2008 financial crisis and will be here for years to come.
Lastly, I couldn’t let this Market Talk go by without alerting you to the rapid changes happening in one of our Bold Profits megatrends.
Breakthrough Developments in 3D Printing
I am referring to the 3D printing industry. I monitor the latest developments in 3D printing through my Bloomberg newswires. Just over the past seven days, news on significant developments and mainstream breakthroughs in 3D printing are pouring in fast and furious.
Most notably, researchers at the National Institute of Standards in Technology, which is a subsidiary of the U.S. Commerce Department, have discovered a way to 3D print structures that are “1,000 times thinner than a human hair.” This process can create complex tissue for regenerative medicine.
This breakthrough, as reported by Medgadget shows that advances in 3D printing are happening now. It’s important to note that the versatility and usability of 3D tech and innovation will be critical as the U.S. begins the process to shift manufacturing more products domestically and at scale, especially in 2021 and beyond.
As this chart shows you, valued at $16 billion this year the global 3D printing products and services market is projected to double or grow by more than 155% to $40.8 billion by 2024.
Stay tuned and hold tight as the 3D printing market grows.
Markets Are Rising Despite Gloomy Sentiment
Friday there was, at least for some people, dramatic news that President Trump and First Lady Melania have tested positive for COVID. We send our wishes to both of them that they are well.
I was looking at what was going on when this was announced on Thursday. On Friday people thought this was going to be a repeat of what happened in March and there would be a crash.
I have to say that people tend to be incredibly negative, pessimistic, and looking at the world through the opposite of rose-colored glasses. Markets are rising. Nonetheless, the sentiment is gloomy.
There’s a lot of information on housing, transportation, and consumer confidence. I’ve put up stories in our Slack channel about containers being sold out until March of next year.
Then shipping freight rates are rocketing up. There are so many indicators telling you the underlying economy is incredibly strong. The base of all this is a mix of the things we’ve been telling our folks about and why we are BOP —bullish, optimistic, positive —on America 2.0 stocks.
The big megatrends are there and then the millennial generation and Gen Z after them are forming the base of housing demand. The housing numbers are nothing short of extraordinary.
Yet, if you go read MarketWatch or Wall Street Journal, you would never know this. You would never know there is an extraordinary housing boom that is based on real demand.
This is very different than what was going on between 2002 and 2007 when the government was doing several things to goose the demand for housing. Wall Street was also doing any number of things to goose the demand for housing so they could sell what they were selling.
This, on the other hand, is driven by actual demand. People need those houses and want those houses. And because of the financial crisis in 2008, we have not been building houses for nearly a decade.
There is a significant scarcity of housing. At Bold Profits, we look at that. That matters. That’s the household formation and it forms the basis of demand for so many things.
New Supply-Demand Will Fuel Economy
I also put up an article talking about the appliance shortage. Now you real demand and the impact of the pandemic. We talk about this on Market Talk all the time: restocking.
Many people wondering, “What is restocking?”
In other words, buying things that need to sit on the shelves so you can buy it.
Then there’s re-inventorying.
That means if you go to the back of the store, there is stuff sitting there to replace what is sitting on the shelf. In the past, that has largely been kept empty because we have relied on just-in-time inventory, shipping, and assuming everything was going to go perfectly.
We learned this year in 2020 that is no longer an option. We are going to have to have at least one week, two weeks, or maybe three weeks depending on your business and what you do with inventory sitting back there that you can put on the shelf in case there is a disruption. That’s going to take a while to build.
Then there’s the third part of this which is that we are also going to bring back the making of things from Mexico and China. We’re going to bring them back to our country.
When you put all this together and put this across the supply chain of every single business, every service, and every product, we are talking about an economy that’s going to be on fire.
America 2.0 Megatrends Leading Fourth Industrial Revolution
Add on to the top of that the megatrends of the Internet of Things (IoT), blockchain, artificial intelligence (AI), transition to sustainable energy, precision medicine. Put all that together and it’s a lollapalooza effect that also has the impact of shifting something we have been missing so long: productivity rises.
In other words, for every dollar you put in you might be lucky to get a dollar back. Now you can get three by year three and five by year five. In other words, rising productivity which incentivizes businesses to spend money to implement those technology megatrends.
The bottom line, there are two worlds. There is America 1.0 which is slowly and surely going away. As I like to say, the destination is certain, only the speed is unknown. The destination is zero.
You can see that if you go and look back to 2007. ExxonMobil was a half-a-trillion-dollar company. It’s worth about 20% of that today. It’s still worth $100 billion, but it’s no longer worth anywhere near the most valuable company.
That is a great example of the America 1.0 effect. Those companies are in decline and will continue to be in decline.
There is another group of companies, America 2.0 companies, that we are BOP on that are in the ascendency and continuing to rise. This is why we continue to be positive.
These are the companies that are innovating. These are the companies that are growing. These are the companies that are taking advantage of the Fourth Industrial Revolution which is America 2.0. They are capitalizing on it in every way they can.
This means implementing IoT, AI, blockchain, or using precision medicine, telemedicine —so many extraordinary things, one layered on top of the other. This is the stuff of booms.
It’s kind of incredible that for the most part —other than Cathie Wood at ARK Invest and a few other folks —there’s no one talking about the Fourth Industrial Revolution, no one talking about the megatrends and what they can do for our society.
However, that’s great for all of our readers and viewers because you are in early. When other folks figure it out —and they will come, for sure —they will come with their hundreds and billions and trillions of dollars.
They are going to come to our stocks where we’ve already made extraordinary amounts of money.
The Profits Unlimited equal-weighted portfolio —our colleague Patrick Goodrich tracks it week after week —is up over 30% this year versus the cap-weighted S&P 500. You can see the effect of laser focusing on America 2.0 stocks.
You can tell I am BOP on America 2.0, the Fourth Industrial Revolution, the coming of age of the millennial generation, and the megatrends.
There is always going to be volatility and always things to worry about. Nothing ever goes up in a straight line.
Nonetheless, if you can absorb the volatility and use our Rules of the Game, we believe this is a once-in-a-lifetime opportunity.
Editor, Profits Unlimited